MOSCOW, Feb 13 (Reuters) - The International Monetary Fund chided Russia on
Thursday for policies it said were slowing economic growth, and called on the
government to speed up structural reforms.

The Fund also said Russia's central bank should concentrate more on cutting
inflation. However, analysts blamed lax budget policy and not the central bank
for high prices, and doubted that the government would rush to follow the IMF's
advice.

"The large fiscal and external surpluses of recent years have placed
Russia in a strong position to deal with a deterioration in the external
environment," the IMF said in a statement after a two-week mission.

"A revival of structural reforms combined with a flexible but cautious
approach to macroeconomic policies will be needed to foster sustained and
broad-based growth," it added.

But most analysts said the government was more focused on parliamentary
elections in December and presidential polls four months later than on
proceeding faster with reforms.

"I wouldn't expect a speeding up of reforms right after the
statement," said Yevgeny Gavrilenkov, chief economist at Troika Dialog
investment bank. "It will happen after the elections."

Russia has not borrowed from the IMF since 1999.

"The role of the IMF has changed dramatically. The IMF is now a speaking
partner. We have very competent people in the government... who know these
issues themselves," said Peter Westin, a senior economist at Aton
brokerage.

SLOWER REFORMS

The prospect of elections appears to have prompted ministers to put the
brakes on potentially unpopular structural reforms.

Russia under President Vladimir Putin has conducted a successful tax reform
and plans further tax cuts. A reform of the telecoms sector is also being
implemented successfully.

However, a key reform of national power utility UES (EESR.RTS), planned for
two years, has so far borne little fruit. Investors are disgruntled while
infrastructure decays.

The State Duma lower house of parliament debates electricity reform bills in
a second reading on Friday and is likely to approve the legislation after months
of wrangling. But the government has said nothing for a year of plans to reform
the world's largest natural gas company, Gazprom (GAZPPE.RTS) (GAZP.MO.(GAZPq.L).

Alexei Zabotkine, chief economist and co-strategist at UFG, said that reforms
had not slowed enough to generate concern.

"Rumours that reforms have slowed down are exaggerated," he said.
"The Duma is likely to pass electricity reform bills, which are very
liberal and radical...The approval of such a law means a lot in an election
year."

BRINGING DOWN INFLATION

The IMF also called on the central bank to give "higher priority to
steadily reducing inflation."

"If oil prices remain strong, revenues from oil sector taxation will be
higher than assumed in the 2003 budget and this windfall should be saved,
followed by a tightening of underlying fiscal policy in 2004, to reduce
pressures for real appreciation of the rouble and so support growth," the
IMF said.

But analysts said the central bank had no power to regulate prices while the
government was pushing electricity, gas, railway and communal services prices
closer to international levels and raising pensions and wages to public
employees.

"In small economies like Russia's, financial policies are more important
for inflation than monetary policy," Gavrilenkov said.

Zabotkine said Russia should not be too zealous in fighting inflation, saying
this made little sense while some prices were being pulled up to world levels,
creating inflationary fears.

"In such a case, the effect of strengthening monetary policy is much
smaller than the damage from a stronger rouble and lower supply of money in the
economy," he said.

"The IMF is overdramatising the situation. It is using its standard
phrases that there is room for improvement. But I do not think there is too much
room of this sort."